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Don’t Get Too Excited About the Starbucks College Deal

The Starbucks program makes college courses more affordable for its workers, but it presents a troubling model for higher education.
Photo by Stuart Caie

It’s all smiles and pats on the back for Starbucks today over news that the coffee chain will cover tuition for employees who enroll in college courses through the Arizona State University (ASU) online program.

The deal is a sweet one at first glance: employees needn’t stay with Starbucks after they graduate, and the blow of higher educational costs for these low-paid workers is significantly reduced. It’s a financial windfall for ASU and a public relations boost for Starbucks.


That said, allow me to be the ghost at the coffee counter.

While the Starbucks program will no doubt make college courses more affordable for its workers and therefore more accessible, this doesn’t equate to a free and no-strings-attached education. There’s also real reason for concern that the Starbucks initiative will be regarded as a new blueprint for education.

Starbucks will pay an average of about $6,500 over two years for freshmen and sophomores who enroll full-time in ASU’s online program, which costs roughly $10,000 in annual tuition. To cover the $13,500 balance, students must apply for financial aid. Because their wages are low, many workers are expected to qualify for Pell Grants.

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The same offer will be available to juniors and seniors with the added benefit that Starbucks will reimburse the tuition costs they pay out-of-pocket. As Anya Kamenetz noted for NPR, “This program is clearly designed especially to entice students to complete their degrees. Higher education experts are increasingly focused on the problem of ‘swirling’ — in other words, working adult students who transfer from institution to institution to accumulate credits for several years without getting a degree.”

Starbucks is not disclosing the details of its financial agreement with ASU, and it’s unclear how many of its 135,000 employees — roughly 25 percent of whom have a bachelor’s degree — will sign up. The demands of full-time education as well as working for the chain at least 20 hours a week are not insignificant. At a retailer where quick employee turnover is a problem, the ASU deal should entice Starbucks’ workers (or “partners” in companyspeak) to remain in the fold for at least the duration of their subsidized education — which serves the company well.


To be sure, there’s a lot of good in this initiative. It might help thousands of people finish degrees with practically no (or very little) debt, which is all too rare these days. More than 70 percent of the college students who graduated in 2012 had an average of nearly $30,000 of student loan debt. Debt at graduation has increased an average of 6 percent each year between 2008 and 2012, and continues to grow. This is a government-backed debt bubble that’s unlikely to burst, or even deflate.

The Starbucks-ASU deal is no solution to this crisis, however. It is, at most, a really good deal on online college for low-paid workers — which is fine. But the rhetoric surrounding the deal (and for ASU, this is certainly a deal) is overhyped. Howard Schultz, chief executive of Starbucks, framed the plan as a response to the “fracturing of the American Dream.”

In a sense, he’s correct, insofar as the American Dream is about corporate revenue. Starbucks will reimburse the full cost of tuition for juniors and seniors after they have earned 21 credits, meaning that about $10,000 needs to already have been paid to the institution. It’s worth noting that the cost of ASU’s online courses is similar to the cost of its traditional courses. As Mark Kantrowitz, publisher of, remarked matter-of-factly to the AP about the spread of online courses, “It’s a way to expand revenue.”

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ASU President Michael Crow has presented the college’s online expansion as a key element of its “New American University” model. However, the promise of expanded access to higher education through online platforms has not come to fruition. Columbia University’s Shanna Smith Jaggars has pointed out that “online coursework — at least as currently and typically implemented — may hinder progression for low-income and underprepared students.” Data suggests that these students risk growing discouraged with technical difficulties and a relative lack of structure, and that they are more likely to withdraw from online courses than traditional ones.

Crow’s exultation in his school’s partnership with Starbucks should haunt anyone who worries about the corporatization of education (which in many respects is already an accomplished fact). “We can help the corporation, we can help the person, we can help the country,” he said. “Imagine if 200 corporations were doing this. Or if 500 corporations were doing this.”

Imagine, indeed. Yes, more people would avoid amassing crippling debt while obtaining degrees. But the very framework of learning would be inextricably tied to working low-paid jobs for giant corporations. The rise in tuition would not be mitigated; those who don’t want to work for one of the partner corporations would suffer; education would be no freer; inequality would still be pervasive.

Make no mistake, behind the feel-good rhetoric lies a basely neoliberal reformist plan that enshrines an entanglement between — as Crow himself put it — corporation, person, and country.

Follow Natasha Lennard on Twitter: @natashalennard

Image via Flickr